Buying a rental property seems like a simple idea, but when you’re ready to take the plunge, it can be easy to get caught up in the details. I’ve heard from countless investors have spent too much time researching, and not enough time taking action. Don’t let that be you! Do your due diligence, but don’t procrastinate getting started. The sooner you buy your first property, the sooner you’ll reach financial freedom.
I’ve laid out seven simple steps you can use in order to purchase your first rental property, grow your portfolio, and become a successful real estate investor!
Set a clear goal. Knowing your end goal is paramount. Define exactly what you want including the exact number of rental properties. If you need some guidance, download our Freedom Cheat Sheet to determine how many rental properties it would take to cover your expenses.
Find your property. There are multiple ways to do this, and it depends on what you’re looking for. You can scour Craigslist for seller-financed properties, find off-market properties, or work with a turnkey provider.
Calculate ROI. You have to know what numbers you’re looking for, and make sure your property meets those standards. I shoot for double-digit net ROI on every single property.
Take action! I cannot stress this step enough—just jump in! I like to say that you’ll never be 100% sure about anything. Don’t let fear or small hesitancies hold you back. If the numbers make sense, just take action!
Get an inspection. An inspection will help you determine what kind of renovation you might want to complete on your property. Check out my video on home inspection reports to learn more.
Find a great property management team. Working with property management companies has been instrumental to my success as an investor. They take care of all the details like vetting tenants, collecting rent checks, and keeping up with the property. I recommend finding a team you can work with long-term, and one that won’t nickel and dime you.
Rinse and repeat! Once you have that first property under your belt, start again, grow your portfolio, and reach financial freedom!